Biodiesel, which is a renewable fuel that has similar combustion properties to fossil diesel, is normally produced by the transesterification of highly refined oils with short-chain alcohols. Since biodiesel can significantly decrease the emission of CO2, SOx, and unburned hydrocarbons from the exhaust of motor vehicles, it is environmentally beneficial, and therefore, a promising alternative to fossil diesel.
Biodiesel is typically produced in a conventional manufacturing operation via the catalyzed transesterification reaction of triglyceride as depicted in Equation 1. In this reaction the oil or fat is reacted with an alcohol to form the biodiesel and glycerine. Such a conventional operation will usually use a strong basic (e.g., NaOH or KOH) or acidic (e.g., H2SO4) solution as a homogeneous catalyst and food-grade vegetable oils as the raw material. These homogeneous catalysts are quite sensitive to the presence of free fatty acids (FFA) and water in the oil feedstock. FFA is known to react with basic catalysts (i.e., NaOH or KOH) to form soaps. The formation of soaps will subsequently complicate the separation of glycerol from the reaction mixture, thereby, drastically reducing the yield of methyl esters.
The presence of water in the oil feedstock will also lead to the hydrolysis of the oils and fatty acid methyl esters (FAME) when a strong basic or acidic catalyst is present. Thus, inexpensive oils, such as crude vegetable oils, waste cooking oil, and other rendered animal fats, that generally contain a high content of FFA and water cannot be directly utilized in a conventional process.

The FFA content in the oil feedstock used in a conventional process with a homogenous catalyst should be less than about 0.5 weight percent, while the water content should be less than about 0.06 weight percent. For this reason, highly refined oils are normally preferred for use in a conventional process for biodiesel production. The cost of the oil feedstock used in a conventional process can account for up to a total of 80% of the cost to produce biodiesel. However, with recent increases in the price for refined oils, the cost of the oil feedstock may account for an even higher fraction of the total production cost. The development of a new catalytic process that could use unrefined and waste oils directly would be advantageous in that it would lower the manufacturing cost for biodiesel.
An acid- and alkali-catalyzed two-step method for biodiesel production that may use a small amount of unrefined or waste oils as a raw material is known. In this two-step method, an acidic catalyst (H2SO4, HCl) is initially used to convert FFA to various esters in the first step. Then in the second step, the transesterification of oil is performed using an alkaline catalyst, i.e., NaOH or KOH. Although this method of producing biodiesel may utilize some unrefined or waste oils, the process requires multiple reactions, washing, and product separation operations, and is not an environmentally benign process. For example, the strong acidic or basic catalysts used in this process are highly corrosive and will need to be removed from the biodiesel product through multiple washing steps. Thus a two-step production process results in the generation of a significant amount of waste water, as well as a continual loss of catalyst, thereby increasing the production cost for the biodiesel product.